FASB addresses classification of cash receipts and payments

FASB posts highlights of April 1 meetingAll decisions reached at Board meetings are tentative and may be changed at future meetings. Decisions are included in an Exposure Draft only after a formal written ballot. Decisions reflected in Exposure Drafts are often changed in redeliberations by the Board based on information received in comment letters, at public roundtable discussions, and from other sources. Board decisions become final after a formal written ballot to issue a final Accounting Standards Update.

At its April 1 meeting, the Board tentatively decided to defer the effective date of ASU 2014-09, Revenue from Contracts with Customers, by one year. See the April 2 edition of On the Horizon for details.

At the same meeting, the Board discussed ways to promote the consistent application of existing guidance on classifying cash receipts and payments in the statement of cash flows. To timely reduce diversity in practice, the Board added to the Emerging Issues Task Force’s agenda a project to address classification for the following items:

PCAOB approves reorganization of auditing standards
The PCAOB approved the reorganization of its auditing standards and adopted amendments to implement a topical system that will integrate existing interim and PCAOB-issued auditing standards.

The reorganization follows the flow of the audit process to help users navigate the standards more easily and efficiently. The standards will be reorganized into the following categories:

Other Matters Associated with Audits: Standards for other work performed in conjunction with an audit

The amendments will remove references to superseded standards and inoperative language and references. They will not impose new requirements or change the substance of performing and reporting on audits performed under PCAOB standards.

The amendments will be effective, subject to SEC approval, as of December 31, 2016.